A company offering stem cell treatments must pay $2.5 million in reimbursements and penalties after violating Iowa consumer protection laws, a judge has ruled.
Iowa Attorney General Brenna Bird’s office filed suit in 2023 against Biologics Health LLC, Summit Partners Group LLC and owners Rylee Meek and Scott Thomas. The suit claimed the companies violated the Iowa Consumer Fraud Act, Older Iowans Act and Iowa Door-to-Door Sales Act by falsely advertising stem cell therapies for back or joint pain that have not received FDA approval.
Bird alleged the companies made misleading and exaggerated claims, including that stem cells could “seek out” problems in the human body and repair or regenerate damaged tissue with only minor side effects. Patients paid an average of $9,000 for the treatments and the company collected more than $1 million in total from Iowans, the state alleged, for little to no therapeutic gain.
In court filings, Biologics argued that it was shielded from being sued under a prior settlement agreement Bird’s office reached with a nurse who had done work for the company. It also argued its owners had reasonably relied on claims from the manufacturers of stem cell products about their efficacy and legal compliance.
In his April 29 judgment order, Judge Lawrence McLellan noted that neither Thomas nor Meek has medical training or licensure. A medical expert for the state testified none of the products they sold had been shown to be safe or effective in clinical trials for the medical conditions Biologics claimed they could treat and that they had not been federally approved for such uses.
Even Biologics’ medical expert witness, whom McLellan found was “unable to provide the kind of competentand reliable scientific evidence necessary to support the defendants’ claim(s),” suggested in testimony that Biologics’ advertising went beyond what could appropriately be claimed about its products, the judge wrote.
McLellan found Biologics in violation of consumer fraud and door-to-door sales laws and permanently barred it from selling or marketing other “regenerative medicine treatments” in Iowa. He also ordered the company pay $1.65 million to reimburse 175 known Iowa customers, offer additional refunds to any unknown Iowa customers and pay nearly $1 million in civil penalties, plus attorney costs to be determined.
In a statement Thursday, May 7, Bird called Biologics “a sophisticated sales scheme targeting vulnerable Iowans who were suffering from chronic pain and illnesses and desperate for relief.”
“Preying on Iowans who are looking for pain relief or medical treatment is evil and illegal,” she said. “Iowans deserve better; this decision sends a message to other con artists and fraudsters that deceptive trade practices will not be tolerated in Iowa.”
Attorneys for Biologics did not immediately respond to a request for comment. Court records show the company is appealing the judgment.
William Morris covers courts for the Des Moines Register. He can be contacted at wrmorris2@registermedia.com or 715-573-8166.
This article originally appeared on Des Moines Register: Stem cell company must pay $2.5 million for false claims to Iowans
Reporting by William Morris, Des Moines Register / Des Moines Register
USA TODAY Network via Reuters Connect
